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Online Shoppers Aren't Impulsive
Rollie Hawk writes "When it comes to online shoppers, conventional wisdom has long been divided. Some have argued that the instant nature of shopping from home over the Internet leads to quick purchases while others have contended that easy price comparisons on the Web allow buyers to do more research first. For now, it looks like the latter camp is closer to the truth.
According to a press release by ScanAlert, online shoppers are more frugal than many retailers previously thought. According to their testing, 35% take more than 12 hours to make a purchase, 21% take more than three days, and 14% take more than a week. On the average, online shoppers take 19 hours to make a purchase after the initial visit.
This has some important marketing ramifications according to ScanAlert CEO Ken Leonard. "The implication to merchants is that the shopping cart is not just a convenience factor. It must be a comfort zone to shoppers. These results were not expected."
In the press release, Leonard advised online sellers that "consumers abandon shopping carts with an ease that frustrates and often confuses online retailers. Retailers must understand, however, that almost half of all online purchases are from shoppers who leave a site after the first visit, and return -- even days later -- to buy.""
If you're going to wait 3-6 days to get what you ordered then you're not an impusle buyer.
"consumers abandon shopping carts with an ease that frustrates and often confuses online retailers"
Given that online purchases involve a potential purchaser having to evaluate a virtual product, rather than something tangible, how can they be surprised? I'm dumbfounded that online sellers compare an eCart to a real shopping trolley. Are they off theirs?
The reason shoppers take their time buying items online is because they know that a better deal is just a click away! It takes no effort to hop onto a competitor's site or a deal site to see if the same item can be found cheaper. On the other hand buying at a real shop has a lower pain threshold. It becomes very easy to say "why waste gas, time, etc I'll just buy this". Not to mention that its much harder to comparision shop, or read up on what other people think, etc.
The exception here is definetly eBay. By placing time restrictions on when people are able to buy items, particularly hard to find items, sellers are able to trick many buyers into believing they have to buy something.
With other vendors however, there are so many options for where you can buy things that often you have to spend weeks just comparing prices.
I've been waiting to buy "What the Bleep do we know" from Amazon.com for over two weeks. I'm not comparing prices or anything, just knowing that it takes only a second to buy it has put me in a lethargic state.
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The reson the shoppers abandon easily is probably because of some popular techniques the online retailers use:
- They force you to add item to cart to see the price.
- After you add item to the cart, they tell you that you have to pay sales tax
- After you add item to cart, you are told that there is a $20 shipping and handling fee, and finally...
- The item is back oredered.
Duh!The impulse buy is this thought process:
"Wow, look at that great deal! Hmm.. I'm here and its a great price, just buy it, save a trip." or "Hmm.. I'm at the store.. what else can I buy that will save me a trip?"
While online, its more like this:
"Wow, look at that great deal! Hmm.. Let me think about it, I can always come back with little effort." <Bookmark URL> <Check deal every 30-60 minutes> "Hmm.. ok I'll buy it."
Online there is no barrier of inconvience to return back to the store, therefore less of an urge to get it NOW!
I think it makes sense that web shoppers aren't implusive because there is no immediate satisfaction. It takes days to actually get your order. If you are impulsive you will probably want the item immediately and will probably go buy it in a real store.
I've abandoned tech book sellers and other smaller online retilers for this very reason. I will put things in my cart on Amazon, and leave them there for weeks or months. I don't always have the discretionary cash to buy all the books and videos that I want, but I like keeping my cart around.
Amazon does this well. If you put a used book in your cart, if that allotment of books goes away, it comes out of your cart. If an item is sold out or discontinued, it comes out of your cart. I would like even more customization, such as email notifications when things get removed from my cart, but it doesn't have that.
This type of E-commerce sophistication should be called the Ebayzinization of the world. We want auctions, we want resale markets, and we want them organized. Companies like Amazon who do this well can create monopolization effects, such as the resale book market. A lot of book sellers hate Amazon, hate the way that they get a bite of a book transaction, on damaged or used books, and don't give them (the sellers) any concession for postage, etc. When you buy a used book from somebody on Amazon, they have nothing to do with it, except to perform a middleman and something of an indemification of the transaction. i.e. if the reseller takes your money and runs, Amazon will work with you to help you get your book.
The key to all of this, is shopping cart power. I want to make wish lists on things I see - and rank them according to what things I would rather have. I can't remember all the things I see that I might like, my brain is not going to remember this, and I don't want to write it down. I want to walk up to a kiosk at a store at Christmas and pull my, and any of my trusted friends shopping carts up, much like wedding registries work. I want to buy a pal something he wants for Christmas, keep who it was anonymous, and be assured that it gets checked off and nobody else gets him the same thing.
This study should serve as a catalyst for even more customization options for major E-retailers. Places like Amazon can market capture places like Crate & Barrel (just picking one from thin air), as the cost and complexity of maintaining that kind of system begins to spiral upward, these type s of places don't want to do it for themselves anymore.
1. Website is broken
2. They just won't tell me shipping costs until it's too late
3. Website hangs, freezes, or something doesn't work with Firefox, or my privacy/security settings.
4. I change my mind.
5. I get scared
6. I lose interest
7. The checkout process just takes way too long
8. They want to "verify" my credit card by calling me.
9. I have to sign an agreement.
10. They need too much personal information.
Why?
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Because frequently, it's the only way to find out how much something costs! A lot of sites are pretty idiotic about their placement (or not)of their prices, though that's not new or limited to web sites
A second reason is becuse you frequently have to go 90% of the way through the ordering process befiore you can find out what shipping options the company has and what they charge. That'll make or break a lot of deals.
So as long as sites purposely or ignorantly hide the details of their pricing and shipping, I'm sure there will be thousands of people like me that abandon their shopping carts for that particular reason.
I guess a lot of people might think twice when they see the total after shipping and (tax) and decide not to buy as well, It's nice to see a total before you are committed to buying
But for me it's always because of a necessary and annoying fact finding mission that I am forced to go on on a large number of sites.
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Given the immediate convenience online shopping provides, there is also no sense of urgency in actually purchasing the items. It's one thing to get dressed, gas up the car/truck/tank, drive to a store after which I almost feel compelled to justify having going to all that trouble by buying something. Whereas with online stores I simply don't feel the need to buy anything on a whim since if one store sells out I'm sure another will have whatever I may be looking for. There's also the amount of time taken to price compare on-the-fly which isn't nearly as convenient in actual brick and mortar stores.
Why am I on Slashdot? I'm bored. Why am I bored? I'm on Slashdot.
I freqently dump my virtual carts or put them on hold and come back to them later. Often, I dump a cart because, surprise surprise, I have to put in my credit card info before seeing the total to be charged. Not on my watch.
I understand many places calculate shipping in the cart because of combined shipping rates, and that's fine. A bit annoying, but fine. But asking me to commit before I know what I've committed to doesn't sit well.
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If I pulled a hundred things off the shelf, but get too frustrated with the lines, I'm going to abandon the cart.
Do you really do this? How much more time do you waste to go back and try again? Seriously if you have already invested even 15 minutes and the wait is 20 minutes (a long wait) and your drive was say 10 minutes, you have already wasted 35-40 minutes and accomplished nothing, only to leave and come back. So, you have wasted at least 80 minutes out of the two trips where if you stayed you could have only wasted 55 minutes and saved yourself nearly a half an hour of frustration.
Which makes more sense?
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We are already seeing this type of behavior at places like priceline.com and LendingTree.com. As well as the numerous shopping engins already in on the web.
I think that retails thought of the web as the "Home shopping network on steriods" and are having trouble swallowing the idea of the internet as the "Global Mall."
JFMILLER
Strive to make your client happy, not necessarly give them what they ask for
In the press release, Leonard advised online sellers that "consumers abandon shopping carts with an ease that frustrates and often confuses online retailers."
Placing a product in the shopping cart is the only way you can find out how much the retailer is going to charge you for shipping.
Some retailers have low product prices that they make up for with outrageously high shipping costs.
I add shipping costs into the final cost of the product to decide where I make my purchase.
Are these "frustrated and confused online retailers" frustrated and confused because online shoppers are wise to their scam?
We must be alert to the danger that public policy could become captive to a scientific-technological elite. - Eisenhower
The ability to compare prices and do research quickly is the big thing that stops me from impulse buying. Plus the fact that I don't feel any emotional prodding of the "Well I drove all the way out here so I might as well buy it" sort.
My usual process is this:
1. Check major sites' descriptions and prices (i.e. REI, Amazon, etc)
2. Look up product reviews via Google and review sites (Toms Hardware, etc)
3. Check similar items, if any
4. Check prices via Froogle and Pricewatch
5. Pick some sellers and check shipping costs on their sites
6. Actually buy something
Obviously this is a lot more fussing than I'd do in a brick/mortar store. I might spend weeks or months before I actually buy something.
Pricewise shipping costs are the real killer for many online purchases. When you add in the cost of shipping the savings vs. buying it in a store frequently disappear, especially for something heavy like a monitor.
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The difference here is instant gratification. When you buy iTunes, you get the reward as soon as you spend the money, that's the advantage of downloadable goods (is there such a thing? lets assume an mp3 is a real object). Indeed, when I buy something at a store, I usually have it out of its packaging before I leave the store or the mall, and certainly by the time I get to the car. If I buy something online, it takes days to get here. So I better make damn well sure I want it and for the price I'm spending, otherwise its more convenient to go to the store. Its hard to be impulsive and plan to get something next week.
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